The electric SUV from VW is now being subsidized with funds from the US government’s Inflation Reduction Act (IRA).
(Photo: IMAGO/ZUMA Wire)
new York The US government on Wednesday published the final version of the list of electric cars that will benefit from tax rebates under the Inflation Reduction Act, President Joe Biden’s multi-billion dollar subsidy package. The good news from Volkswagen’s point of view: The Wolfsburg-based company is now receiving state funding.
According to the list, the electric hopeful ID.4, a Chattanooga-built SUV, receives the full $7,500 tax rebate.
Volkswagen is the only foreign manufacturer to qualify for the subsidy with at least one car. All other competitors from Germany, Korea, Japan and other countries get nothing.
The ID.4, which is offered at a base price of just under $39,000, is now “not only extremely affordable, but also competitive with conventional compact SUVs,” Volkswagen said. “Thanks to local manufacturing and sourcing” one is eligible for the full tax rebate.
“This is great news for consumers in the US because it expands the choice of truly affordable electric vehicles,” said Pablo Di Si, head of VW North America.
Confusion about funding list
The Reuters agency reported on Monday that the ID.4 would not benefit from the tax credit. As the Handelsblatt reported, Volkswagen had not provided the necessary proof of the origin of battery components in time for the publication of the first version of the list.
The background is a missing certificate. According to company circles, the Korean supplier SKI only provided the necessary certificate on Tuesday, which Volkswagen was then able to send to the US government. A spokesman declined to comment further on Wednesday’s request.
At Volkswagen, it is expected that the full tax rebate will become an important selling point in the dealer organization. The group is dependent on the sales success of the ID.4, as Wolfsburg wants to make itself at least a little more independent of the Chinese market with a significant increase in the US market share.
The ID.4 sold 10,000 units in North America in the first quarter, tripling the same period last year. According to the company, this made it the fourth best-selling electric vehicle on the market. North America boss Di Si will focus on further electric SUVs “made in America” in the coming years.
In addition to the ID.4, electric cars from the US brands Cadillac, Chevrolet, Chrysler, Ford, Jeep, Lincoln and Tesla are being promoted.
The tax breaks are part of the 430 billion dollar Inflation Reduction Act to strengthen the USA as an industrial location. In order for customers to have access to the funds, various subsidy criteria must be met. For example, the vehicles must be assembled in the USA, and at least 50 percent of the value of the battery components must come from domestic production. Price and income limits also apply.
More: US Treasury Department publishes list of funded electric cars